A common trait in Portuguese entrepreneurs is their excessive individuality. In traditional sectors this has been most unfortunate, as it has inhibited cooperation between exporting companies that are usually small in the world stage and could benefit hugely if they worked more closely together.
[[Note by EACCNY – We see this as an issue for startups from other EU Countries as well]]
I’ve even witnessed first hand a Private Equity firm trying to promote an agreement between portfolio companies to jointly scout a specific foreign market. At the first opportunity, companies tried to steal clients from one another!In the Tech space, entrepreneurs tend to collaborate more. Part of it is due to a learn-with-each-other kind of culture promoted in accelerators programs and incubators. Then there is also the fact that the projects are not usually direct competitors with one another. Nevertheless there is still ample room for improvement, and synergies to be leverage at various levels:
1. Sales: specially in foreign markets where networks of contacts are thinner and knowledge of what works and doesn’t work is scarcer, sharing experiences, hard won learnings and insights is very valuable. Also if you find out that someone has a specific need that is not covered by your offer, but you know of another startup that can solve that problem, make the introduction. Today you did a good deed, tomorrow you’ll be in the receiving end.
2. Marketing: with paid marketing being increasingly viewed as an inefficient way to scale the costumer base, startups have turned to content marketing as the better alternative. One way to boost these efforts is through networking between the startups themselves, i.e. through sharing each other’s posts, commenting, making guest posts and helping each other with white papers, use cases or in whatever other way possible.
3. Industry Association: the new wave of tech entrepreneurs that has arisen in Portugal, doesn’t seem to have integrated itself in any of the historic associations, such as Anje (Portuguese young entrepreneurs association), APDC (Portuguese association for the development of communications) or ANETIE (Portuguese association of the IT&Electronics companies). Going beyond the discussion of whether it makes sense to have two almost identical associations such as APDC and ANETIE in a small country such as Portugal, there should be a forum for tech entrepreneurs to come together and discuss the challenges they face and how they as a group can contribute to overcome them. Additionally this forum should also foster a better understanding between tech startups and more established tech companies. As the more established companies successfully grow abroad, startups could complement their offers, giving them an edge on innovation and differentiation vis a vis other established competitors.
4. Public Relations: articles in specialized media such as TechCrunch or The Next Web are very important to build awareness among potential partners and investors. PR firms have the relationships and the know-how of what is publishable. Cost is of course the biggest hurdle for startups to work with them. If however several startups bundle together, they’ll be able to get better prices and the media exposure they need and deserve.
5. Development: do you really have to code every feature from scratch? Aren’t there some features that aren’t core to your solution and you can integrate from someone else that is more specialize in that area? Try harder to look for win-win situations. In the very least there are some technical aspects in which you could use some help. Why not reach out to someone who has already had to crack it? There’s probably something else you could help him in return!
6. Trade-shows: tech trade-shows such as the Mobile World Congress are prohibitively expensive for most startups to have a stand by themselves. If however several startups came together and shared the cost it would be possible for them to have a presence there. Some people will say it’s the government role to organize such things. In the last Mobile World Congress, Greece had a very interesting stand featuring several tech companies and it was the Entrepreneurs association that organized it and the companies which were present there that paid for it. They didn’t wait for someone else to do it for them, they made it happen!
7. Human Resources: an administrative assistant or a controller/CFO would be very helpful in various situations, namely to free the CEO from some bureaucratic tasks and let him concentrate in sales and raising funds. The thing is that there really isn’t work for a full time resource, so why not share one between 2 or 3 startups?
By Fernando Peres Ferreira, Investment Manager at Portugal Capital Ventures | Compliments of AICEP – A member of the EACCNY